GYEN Stablecoin Glitch
Outraged Coinbase customers have launched an online campaign demanding. The cryptocurrency exchange refunds its losses following a technical issue that caused the company to freeze accounts for weeks. This potentially resulted in significant losses for many customers.
Coinbase informed customers that technical reasons caused a hiccup in trading two cryptocurrencies in mid-November. The issue first became apparent when Coinbase customers could purchase GYEN. GYEN is a stablecoin pegged to the value of one Japanese yen. POWR is a cryptocurrency for energy trading. It was a part of a blunder too.
The dispute highlights the dangers that millions of individual investors face as they enter new, lightly regulated cryptocurrency markets where the road rules are unclear. And it demonstrates that stablecoins, marketed as pegged to outside assets to avoid the massive price volatility seen in other cryptocurrencies, are not consistently as stable as their name implies.
Beginning around November 17, the coin became untethered from the yen price it aimed for. According to Chainalysis, it reached a high of 0.065643, approximately 7.5 times the fiat equivalent investors expected.
Transfer activity to Coinbase accelerated beginning November 18 and peaked the following day at $122 million, according to Chainalysis. Transfer activity from Coinbase, on the other hand, peaked on November 20, according to the firm. The volume transferred from Coinbase on that day accounted for 84 percent of total transfers.
It’s unclear how many customers were involved and how many could profit from the sudden price increase and sell before the price crashed again. Between the 15th and 19th of November 2021, GYEN on Coinbase experienced unexpected behavior due to unusual market conditions. It was complicated further on November 19, when Coinbase disabled trading for GYEN for technical reasons.
For customers trading with GYEN before November 19, this may have resulted in decimal display issues for transactions. Meanwhile, the wallet balance accurately reflected the amount sold. Ryan Huett, an Oregon winemaker, is in charge of a Facebook group with over 1,700 angry Coinbase customers looking for answers. He bought about $75,000 worth of GYEN, but his balance showed 100 times that amount at one point.
When they try to fix the receipts four weeks later, instead of the two pizzas you ordered for 19.88, you get four slices of one pizza because they keep the rest.
Get the latest economy news, trading news, and Forex news on Finance Brokerage. Check out our comprehensive trading education and list of best Forex brokers list here. If you are interested in following the latest news on the topic, please follow Finance Brokerage on Google News.